Pre-feasibility Study
SETTING UP
GENERAL
MEDICAL AND
SURGICAL
HOSPITAL
November 2021
The figures and financial projections are approximate due to fluctuations in
exchange rates, energy costs, and fuel prices etc. Users are advised to focus on
understanding essential elements such as production processes and capacities, space,
machinery,
human
resources,
and raw
material etc.
requirements.
Project
investment, operating costs, andrevenues can change daily. For accurate financial
calculations, utilize financial calculators on SMEDA’s website and consult financial
experts to stay current with market conditions.
Small and Medium Enterprises Development Authority
Ministry of Industries and Production
Government of Pakistan
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Table of Contents
1.
DISCLAIMER .................................................................................................. 4
2.
EXECUTIVE SUMMARY ................................................................................. 5
3.
INTRODUCTION TO SMEDA ......................................................................... 6
4.
PURPOSE OF THE DOCUMENT ................................................................... 7
5.
BRIEF DESCRIPTION OF PROJECT & Services ......................................... 8
5.1
Services ....................................................................................................... 8
5.2
PROCESS FLOW OF HOSPITAL FOR OPD AND SURGERY ................. 13
5.3
PROCESS FLOW OF HOSPITAL FOR EMERGENCY ............................. 14
5.4
Installed and Operational Capacities ......................................................... 14
6.
CRITICAL FACTORS ................................................................................... 18
7.
GEOGRAPHICAL POTENTIAL FOR INVESTMENT ................................... 18
8.
POTENTIAL TARGET MARKET .................................................................. 18
9.
PROJECT COST Summary ......................................................................... 19
9.1.
Project Economics ..................................................................................... 20
9.2.
Initial Project Cost Estimates ..................................................................... 20
9.1.1.
9.1.2.
9.1.3.
9.1.4.
9.1.5.
9.1.6.
9.1.7.
9.1.8.
9.1.9.
9.1.10.
9.1.11.
9.1.12.
9.1.13.
9.1.14.
9.1.15.
9.1.16.
9.1.17.
9.1.18.
Land .................................................................................................... 21
Building ............................................................................................... 22
Medical Machinery and Equipment ..................................................... 23
Hospital Machinery and Equipment .................................................... 25
Furniture and Fixture........................................................................... 26
Office Vehicles .................................................................................... 26
Office Equipment ................................................................................ 27
Medical Books .................................................................................... 28
Pre-Operating Cost ............................................................................. 28
Security against Building..................................................................... 28
Legal and Licensing Fee ..................................................................... 28
Breakeven Analysis ............................................................................ 29
Revenue Generation ........................................................................... 29
Variable Cost ...................................................................................... 32
Fixed Cost Estimate ............................................................................ 34
Financial Feasibility Analysis .............................................................. 35
Financial Feasibility Analysis with 50% Debt ...................................... 35
Human Resource ................................................................................ 35
10.
CONTACT DETAILS ..................................................................................... 37
11.
USEFUL LINKS and contacts ..................................................................... 38
12.
ANNEXURES ................................................................................................ 40
12.1. Income Statement ...................................................................................... 40
12.2. Balance Sheet............................................................................................ 41
12.3. Cash Flow Statement ................................................................................. 42
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13.
Setting Up General Medical and Surgical Hospital
KEY ASSUMPTIONS .................................................................................... 43
13.1. Operating Cost Assumptions ..................................................................... 43
13.2. Revenue Assumptions ............................................................................... 43
13.3. Financial Assumptions ............................................................................... 43
13.4. Debt Related Assumptions......................................................................... 44
13.5. Cash Flow Assumptions ............................................................................ 44
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Setting Up General Medical and Surgical Hospital
Table of Tables
Table 1: Installed and Operational Capacity for OPD ..................................................... 15
Table 2: Installed and Operational Capacity for OPD ..................................................... 15
Table 3: Installed and Operational Capacity for Surgeries ............................................. 16
Table 4: Installed and Operational Capacity for General Ward & Private Room ........ 17
Table 5: Installed and Operational Capacity for Emergency .......................................... 17
Table 6: Installed and Operational Capacity for Diagnostic Lab ................................... 17
Table 7: Initial Project Cost Estimate ................................................................................. 20
Table 8: Land Area Breakup................................................................................................ 21
Table 9: Building Renovation Cost ..................................................................................... 22
Table 10: Medical Machinery & Equipment ...................................................................... 23
Table 11: Hospital Machinery and Equipment .................................................................. 25
Table 12: Furniture and Fixtures ......................................................................................... 26
Table 13: Office Vehicles ..................................................................................................... 26
Table 14: Office Equipment ................................................................................................. 27
Table 15: Medical Books ...................................................................................................... 28
Table 16: Pre-Operating Cost ............................................................................................. 28
Table 17: Security against Building .................................................................................... 28
Table 18: Legal and Licensing Fee .................................................................................... 28
Table 19 : Breakeven Analysis............................................................................................ 29
Table 20: Revenue Generation ........................................................................................... 29
Table 21: Reveneue from General OPD and Emergency .............................................. 29
Table 22: Revenue from Specialist OPD........................................................................... 30
Table 23: Revenue from OT ................................................................................................ 30
Table 24: Revenue from Wards and Rooms .................................................................... 31
Table 25: Revenue from Diagnostic Lab ........................................................................... 31
Table 26:Revenue from Rent .............................................................................................. 31
Table 27: Variable Cost ........................................................................................................ 32
Table 28: Patient Consumables .......................................................................................... 32
Table 29: Other Consumables ............................................................................................ 33
Table 30:Diagnostic Lab Consumables ............................................................................. 34
Table 31: Fixed Cost Estimate ............................................................................................ 34
Table 32: Financial Feasibility Analysis ............................................................................. 35
Table 33: Financial Feasibility Analysis with 50% Debt .................................................. 35
Table 34: Human Resource Requirement......................................................................... 35
Table 35: Suppliers of Equipment & Supplies .................................................................. 37
Table 36: Useful Links .......................................................................................................... 38
Table 37: Healthcare Commissions - Contact Numbers................................................. 39
Table 38: Operating Cost Assumptions ............................................................................. 43
Table 39: Revenue Assumptions ........................................................................................ 43
Table 40: Financial Assumptions ........................................................................................ 43
Table 41: Debt Related Assumptions ................................................................................ 44
Table 42: Cash Flow Assumptions ..................................................................................... 44
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1.
Setting Up General Medical and Surgical Hospital
DISCLAIMER
This information memorandum is to introduce the subject matter and provide a general
idea and information on the said matter. Although, the material included in this
document is based on data/information gathered from various reliable sources;
however, it is based upon certain assumptions, which may differ from case to case.
The information has been provided on as is where is basis without any warranties or
assertions as to the correctness or soundness thereof. Although, due care and
diligence has been taken to compile this document, the contained information may
vary due to any change in any of the concerned factors, and the actual results may
differ substantially from the presented information. SMEDA, its employees or agents
do not assume any liability for any financial or other loss resulting from this
memorandum in consequence of undertaking this activity. The contained information
does not preclude any further professional advice to be obtained by the user. The
prospective user of this memorandum is encouraged to carry out additional diligence
and gather any information which is necessary for making an informed decision,
including taking professional advice from a qualified consultant/technical expert before
taking any decision to act upon the information.
For more information on services offered by SMEDA, please contact our website:
www.smeda.org.pk
Document Control
Document No.
228
Prepared by
SMEDA-Punjab (OS)
Revision Date
November 2021
For information
helpdesk.punjab@smeda.org.pk
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Pre-Feasibility Study
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Setting Up General Medical and Surgical Hospital
EXECUTIVE SUMMARY
Hospital is an institution established for diagnosis and treatment of people suffering
from different types of diseases. A hospital usually provides both medicine consultancy
and surgical services to treat the sick people. The hospitals usually offer both
outpatient and inpatient services to the people coming for treatment. Under the
outpatient services, a person may consult the doctor available in the hospital to get his
expert opinion on his health-related issues. Such patients are not admitted into the
hospital for longer treatments. In contrast, under the inpatient services, the sick people
are admitted into the hospital to provide them closer and/or sustained medical
treatment or for performing any requried surgical procedures to treat their aliments.
The duration of stay of a patient in the hospital depends upon the nature and specific
needs of a patient’s disease and treatment.
A General medical and surgical hospital is established to provide healthcare services
in a broad category of illness and/or injury cases. General Medicine is a speciality of
medical profession which is involved in the prevention, diagnosis, and treatment of a
wide range of diseases affecting different systems of the body. Doctors specializing in
general or internal medicine are known as General Physicians. In addition to General
Physicians, doctors specializing in different organs of human body also provide
outpatient medical services in hospitals. General Surgery is a broad term which refers
to carrying out routine surgical procedures to treat the issues identified in the internal
parts of the body. General surgery usually does not cover vital organs like heart, liver,
brain, lungs, etc. General surgeons usually cover diseases and injuries relating to the
abdomen, chest, groin, digestive system and thyroid. In addition to the regular
outpatient and inpatient services, a hospital also provides emergency services to
handle cases which require an immediate and urgent medical attention and treatment.
The proposed General Medical and Surgical Hospital offers the regular outpatient,
inpatient and 24 hours basic emergency services. The propsoed hosptial maintains
beds in general ward and private rooms and emergency ward. It is also equipped with
the diagnsotic services to conduct basic blood tests, x-rays, ultrasound and ECG
(Electrocardiogram).
This pre-feasibility document provides details for “Setting up General Medical and
Surgical Hospital”. The proposed project has an annual capacity of treating 14,400
patients in General Outpatient Department (OPD) and 28,800 patients in Specialist
OPD, carrying out 2,160 surgeries and handling 12,960 emergency patients. The
hospital has an occupancy capacity of 4,320 General Ward days, 1,440 ICU Ward day
and 1,440 Private Room days. The capacity utilization in the first year of operations is
assumed to be 60%, which translates into 8,640 and 17,280 general and specialist
OPD patients respectively, 1,298 surgery patients, 7,776 emergency patients and
2,592 occupancy days for General Ward and 864 annual occupancy days each for
ICU Ward and Private Rooms each. The maximum capacity utilization of the proposed
project is assumed to be 90% which is achieved in the seventh year of operation.
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The proposed project requires a total investment of PKR 47.71 million. This includes
capital investment of PKR 43.7 million and working capital of PKR 4 million. This
project is financed through 100% equity. The Net Present Value (NPV) of project is
PKR 153.9 million with an Internal Rate of Return (IRR) of 53% and a Payback period
of 2.56 years. Further, this project is expected to generate Gross Profit (GP) ratio
ranging from of 36% to 45% and Net Profit (NP) ratio ranging from 5% to 17% during
the projection period of ten years. The proposed project will achieve its estimated
breakeven point at capacity of 41% (34,840 patients) with breakeven revenue of PKR
42.62 million.
The proposed project may also be established using leveraged financing. At 50%
financing at a cost of KIBOR+3%, the proposed unit provides Net Present Value (NPV)
of PKR 173.42 million, Internal Rate of Return (IRR) of 52% and Payback period of
2.65 years. Further, this project is expected to generate Net Profit (NP) ratio ranging
from 4% to 17% during the projection period of ten years. The proposed project will
achieve its estimated breakeven point at capacity of 41% (35,025 patients) with
breakeven revenue of PKR 42.62 million.
The proposed project will provide employment opportunities to 90 people. High return
on investment and steady growth of business is expected with the professionals
having some prior experience and expertise in the related field of business. The legal
business status of this project is proposed as a partnership concern.
3.
INTRODUCTION TO SMEDA
The Small and Medium Enterprises Development Authority (SMEDA) was established
in October 1998 with an objective to provide fresh impetus to the economy through
development of Small and Medium Enterprises (SMEs).
With a mission "to assist in employment generation and value addition to the national
income, through development of the SME sector, by helping increase the number,
scale and competitiveness of SMEs", SMEDA has carried out ‘sectoral research’ to
identify policy, access to finance, business development services, strategic initiatives
and institutional collaboration and networking initiatives.
Preparation and dissemination of prefeasibility studies in key areas of investment has
been a successful hallmark of SME facilitation by SMEDA.
Concurrent to the prefeasibility studies, a broad spectrum of business development
services is also offered to the SMEs by SMEDA. These services include identification
of experts and consultants and delivery of need-based capacity building programs of
different types in addition to business guidance through help desk services.
National Business Development Program for SMEs (NBDP) is a project of SMEDA,
funded through Public Sector Development Program of Government of Pakistan.
The NBDP envisages provision of handholding support / business development
services to SMEs to promote business startup, improvement of efficiencies in existing
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
SME value chains to make them globally competitive and provide conducive business
environment through evidence-based policy-assistance to the Government of
Pakistan. The Project is objectively designed to support SMEDA's capacity of
providing an effective handholding to SMEs. The proposed program aimed at
facilitating around 314,000 SME beneficiaries over a period of five years.
4.
PURPOSE OF THE DOCUMENT
The objective of the pre-feasibility study is primarily to facilitate potential entrepreneurs
in project identification for investment. The project pre-feasibility may form the basis
of an important investment decision and in order to serve this objective, the
document/study covers various aspects of project concept development, start-up, and
production, marketing, finance and business management.
The purpose of this document is to provide information to the potential investors about
setting-up a “General Medical and Surgical Hospital”. The document provides a
general understanding of the business to facilitates potential investors in crucial and
effective investment decisions.
The need to come up with pre-feasibility reports for undocumented or minimally
documented sectors attains greater imminence as the research that precedes such
reports reveal certain thumb rules; best practices developed by existing enterprises by
trial and error, and certain industrial norms that become a guiding source regarding
various aspects of business setup and its successful management.
Apart from carefully studying the whole document one must consider critical aspects
provided later on, which form the basis of any investment decision.
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5.
Setting Up General Medical and Surgical Hospital
BRIEF DESCRIPTION OF PROJECT & SERVICES
A general medical and surgical hospital provides a wide range of medical and surgical
services to inpatient, outpatient and emergency patients. Under the outpatient
services, a person may consult the doctor available in the hospital to get his expert
opinion on his health-related issues. These patients are not admitted into the hospital
for longer treatments. Whereas, inpatient hospital services means longer healthcare
services provided to patients who have to be admitted into the hospital and are
required to remain in that hospital for one or more days. Furthermore, the proposed
hospital also provides 24-hour emergency services. A brief description of the offered
services is as follows:
5.1 Services
The proposed hospital provides services six days a week for OPD, four days a week
Operation Theater (OT) services for conducting surgeries and seven days a week for
Emergency cases. OPD and OT operates for twelve hours a day with morning and
evening shifts of six hours while the emergency is operational round the clock (24
hours) without any break during a year. The visiting surgeons are engaged for
performing surgeries. The surgeons receive 60% of their service charges as their
income and this amount is included one of the direct costs of the hospital. Furthermore,
General ward and Private room facilities are also available if a patient needs to be
admitted for longer treatments (inpatient services).
Emergency
An emergency room or emergency department is a medical treatment facility that
specializes in providing medical services which are required on urgent basis (such as
persons suffering accidents, strokes, etc.). Therefore such patients are treated without
an appointment in the emergency department.
Outpatient Department (OPD)
In OPD, the patient can seek consultation with a general physician or a specialist
doctor to discuss his health-related issues. It is the first interaction between the patient
and the doctor. The proposed hospital provides two types of OPD services; general
and specialized.
General OPD
General OPD healthcase services are provided by General Physicians. A General
Physician is a doctor who deals with the diagnosis and treatment of general health
problems or disorders ranging from cold, cough, fever, pain and nausea to chronic
diseases such as jaundice, cholera, etc. Apart from diagnosing and treating health
problems, the General Physicians also advise the patients about their diet, health
plans and any requried preventive measures. In certain complicated cases, the
General Physcian may refer the patient to a medical or surgical specialist. People can
come to this OPD without any appointment and they are treated on first-come-firstserved basis.
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Specialist OPD
Specialist OPD provides the services of specialist doctors who have special expertise
in any specific one body system/part or in specific area of medical knowledge.
Specialist doctors are available in all fields of medicine. The following specialists will
be visiting the proposed hospital:
Cardiologist is a doctor who specializes in treating diseases of the cardiovascular
system, mainly the heart and blood vessels.
Neurophysician is a doctor who specializes in treating diseases of the nervous
system. It includes the brain and spinal cord.
Orthopaedic Surgeon are doctors who specialize in the musculoskeletal system - the
bones, joints, ligaments, tendons, and muscles that are so essential to movement and
everyday life.
Gastroenterologist specializes in the branch of medicine that focuses on the
digestive tract and the gallbladder, liver, bile ducts, and pancreas.
Ophtalmologists are the medical doctors who specialize in treating eye and vision
problems.
Pulmonologist is a doctor who diagnoses and treats diseases of the respiratory
system which includes the lungs and other organs that help a person breathe.
Paediatrics are the doctors who manage medical conditions affecting infants, children
and young people.
Gynaecologist is a doctor who specializes in female reproductive health. They
diagnose and treat issues related to the female reproductive tract. This includes the
uterus, fallopian tubes, and ovaries and breasts.
Urologists are the doctors who diagnose and treat diseases of the urinary tract in
both men and women. The urinary tract includes two kidneys, two ureters, a bladder,
and a urethra. They also diagnose and treat anything involving the reproductive tract
in men.
Nephrologists is a physician who specializes in the care and treatment of kidney
diseases.
Dermatologist is a doctor who specializes in conditions involving the skin, hair, and
nails.
ENT Specialist is an ear, nose, and throat doctor (ENT) who specializes in everything
having to do with these body parts.
General Surgeon is a specialist who is trained to diagnose, treat, and manage
patients with a broad spectrum of surgical conditions affecting almost any area of the
body.
Endocrinologist is a doctor who specializes in the diagnosis and treatment of
hormone-related diseases and conditions.
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Psychiatrist specializes in mental health, including substance use disorders.
Physiotherapists help people affected by injury, illness or disability by movement and
exercise, manual therapy, education and advice. They maintain health for people of
all ages, helping patients to manage pain and prevent disease.
In the proposed hospital all the specialists are assumed to be the visiting doctors. Each
specialist doctor is available for three hours for six days per week. Share of revenue
for the hospital is 40% of the total revenue from patients checked by the specialist
doctors, while the balance 60% is the remuneration of the respective doctor; and a
direct cost for the hospital.
Diagnostic Tests
The proposed hospital also provides the following basic diagnostic testing services.
Complete Blood Count (CBC)
Complete Blood Count (CBC) is a group of tests used to evaluate the composition of
the blood. The cell calculates the shares of different constituents of the blood (such as
red blood cells (RBCs), white blood cells (WBCs), platelets (PLTs), etc.) with reference
to the standard blood composition. CBC test provides information about the overall
health of a person and indicates towards different kinds of diseases and conditions;
associated with the changes in relative shares of different blood constituents.
ABO Typing Test (Blood Group)
Blood typing is a method to tell what type of blood a person has. Blood typing is often
done so a person can safely donate blood or receive a blood transfusion. A person’s
blood type is based on whether or not certain proteins are present on red blood cells.
These proteins are called antigens. The blood type (or blood group) depends on what
types the parents passed down. Blood is often grouped according to the ABO blood
typing system. The four major blood types are Type A, Type B, Type AB and Type O.
This service is commonly required as a part of performing surgerical treatments.
X-Ray
X-Ray is an image of organs, tissues and bones of the body. These images are
produced with the help of radiations. An X-ray is normally conducted to examine an
area where a patient is experiencing pain or discomfort.
Ultrasound
Ultrasound, also called sonography, is a medical test that uses high frequency sound
waves to capture live images from inside a patient’s body. Ultrasound test is performed
when a patient is having pain, swelling, or other symptoms that require an internal
view of organs i.e., kidney, liver, spleen, bladder, ovaries, uterus, pancreas, thyroid,
blood vessels, etc.
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Intensive Care Unit (ICU)
ICU is a special department of a hospital or healthcare facility that provides intensive
treatment medicine and caters to patients with severe and life-threatening illnesses
and injuries; the ones which require constant, close monitoring and immediate
attention of the specialist doctors.
General Surgical Services
General Medical and Surgical unit is maintained for treatment of ailments which
require the use of surgical procedures. It includes the following surgeries:
Appendectomy
It is the surgical removal of the appendix. It is a common emergency surgery that is
performed to treat appendicitis, which is an inflammatory condition of the appendix.
The appendix is a small, tube-shaped pouch attached to the large intestine.
Gallstone
A cholecystectomy is a surgical procedure to remove the gall bladder, a pear shaped
organ just below the liver on the upper right side of the abdomen. The gall bladder
collects and stores bile, a digestive fluid produced in the liver. A cholecystectomy is a
common surgery, and it carries only a small risk of complications. In most cases, the
patient can go home the same day or the day after the surgery.
Hernia
A hernia occurs when part of an internal organ or body part swells into an area where
it should not. The most common hernias occur in the abdominal area. A small portion
of the intestine, or a piece of fat, pushes through a weak area in the muscular wall of
the abdomen. This causes an abnormal swelling under the skin of the abdomen,
usually near the groin or navel. The hernia surgery or herniorrhaphy involves returning
the displaced tissues to their proper position.
Hemorrhoids
Hemorrhoids surgery removes swollen blood vessels inside or around the anus and
rectum. Doctors refer to these swollen vessels as hemorrhoids. There are different
surgical options for treating hemorrhoids that cause a person discomfort.
Laparotomy
Laparatomy is a surgical incision (cut) into the abdominal cavity. This operation is
performed to examine the abdominal organs and aid diagnosis of any problems,
including abdominal pain.
Gastrectomy
A gastrectomy is often used to treat stomach disorders. A gastrectomy is a surgery in
which part or all of the stomach is removed. A gastrectomy may be used to treat
obesity, peptic ulcers, a perforation (hole) in the stomach, or some forms of cancer.
When part of the stomach is removed, it is called a partial, or a subtotal, gastrectomy.
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Removing the stomach does not take away the patient’s ability to digest liquids and
foods. However, several lifestyle changes are to be made after the procedure.
Bowel/Colon Resection
A bowel resection or enterectomy is a surgical procedure in which a part of an intestine
is removed, from either the small intestine or large intestine. The goal of bowel
resection is to take out the part of the colon or rectum where the problem is identified.
Thyroidectomy
Thyroidectomy is the surgical removal of all or part of the thyroid gland, a butterflyshaped gland located at the base of the neck. It produces hormones that control every
aspect of the metabolism, from heart rate to how quickly the calories are burnt.
Thyroidectomy is used to treat thyroid disorders, such as cancer, noncancerous
enlargement of the thyroid and overactive thyroid (hyperthyroidism).
Percutaneous Nephrolithotomy
Percutaneous nephrolithotomy (PCNL) is a procedure used to remove kidney stones
from the body when they cnnot pass out on their own. A scope is inserted through a
small incision in body to remove the kidney stones. It is most suitable to remove stones
of more than 2 cm in size.
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5.2
Setting Up General Medical and Surgical Hospital
PROCESS FLOW OF HOSPITAL FOR OPD AND SURGERY
Appointment
A customer may visit or call the reception of the hospital to inquire about doctor’s
schedule. The receptionist provide information about the hospital’s schedule i.e time,
counsultancy fee, etc after that he/she may get an appointment to consult his/her
relevant doctor.
Consultation
At this step, the doctor meets with the patient and obtains his medical history.
Analyzing the condition of the patient, the doctor may prescribe medicines and may
suggest a date for follow up examination. Doctor may also recommend any necessary
diagnostic tests before prescibing medicines. If needed, the doctor may also advise
the patient about food and supplements and any required physical activities.
File Preparation And Payment for OPD
Patient file is prepared which includes personal information. In case, the treatment
involves surgical procedures, the patient is informed about that. For OPD service, only
fee will be charged.
Admission to Hospital & Payment for Test and Surgery
In case the patient is willing to go for the surgery, he is admitted into the hospital.
Consent forms are signed by the patient before the surgery. Tests and surgery
charges /fee are paid in advance in the accounts department. Time and date of surgery
is conveyed to the patient.
Basic Tests
Surgery is performed after conducting basic tests from pathology laboratory such as
Complete Blood Count (CBC), ABO Typing Test, X-Ray, Ultra Sound, etc.
Surgery
After analysing the test reports, the doctor conducts the respective surgery. The time
period of performing diffferent surgeries varies accordingly. In some severe cases, the
surgery might take longer than normal time.
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Recovery Room /Ward
After the surgery, patient is shifted to a recovery room where he is attended by doctors
and nurses. Once the patient’s condition stablizes, he is shifted to general ward or
private room.
Discharge
After the recovery of patients, their documentation is completed and discharge slips
are prepared by the administration staff after payment of any dues remaining if any.
The patients are discharged from the hospital.
5.3
PROCESS FLOW OF HOSPITAL FOR EMERGENCY
Patient's
Arrival
Consultation &
Treatment
Payment
Patient's
Discharge
Patient's Arrival
There is no need for appointment in the emergency department as the patients who
come to emergency need urgent assistance and treatment.
Consultation and Treatment
The doctor checks the patient and obtains their medical history and the current
problems of the patient. Analyzing his condition, the doctor prescribes immediate
measures including medicines, injections, etc. The doctor may also recommend any
necessary diagnostic tests before prescibing medicines.
Payment
After checkup, bill is generated by account staff and payment is made by customer.
Patient’s Discharge
Patient’s arriving in emergency required immediate treatment. Once the patient’s
condition becomes stable, he is discharged from emergancy. In case patient’s
condition is not stable or required further treatment advice of specialist doctor may be
sought and/or he may be admitted into the hospital.
5.4 Installed and Operational Capacities
The proposed hospital provides services six days a week for General OPD, Specialist
OPD and Diagnostic Lab, four days a week for Operation Theatre (OT) and seven
days a week for Emergency. General OPD and OT will operate twelve hours a day
with morning and evening shifts of six hours while in Specialist OPD each specialist
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doctor will be avialable for 3 hours during each working day. Emergency department
will be operational 24 hours a day, round the year.
The proposed project has an annual capacity of treating 14,400 patients in General
Outpatient Department (OPD) and 28,800 patients in Specialist OPD, carrying out
2,160 surgeries and handling 12,960 emergency patients. The hospital has an
occupancy capacity of 4,320 general ward days, 1,440 ICU ward days and 1,440
private room days. However, during initial year of operation, the proposed hospital is
expected to obtain 60% of its installed capacity. The operations of proposed business
are assumed to increase at a rate of 5% annually, reaching 90% capacity utilization
during 7th year of operations. Table 1, Table 3, Table 4,Table 5 and Table 6 show the
installed and operational capacities of OPD, Surgeries, General Ward, Private room,
ICU Ward and Emergency and Diagnostic Lab respectively.
Table 1: Installed and Operational Capacity for OPD
Services Number
Time
of
/Patient
Doctors
(hrs)
Available
Hours/Year
No of
Patients
at 100%
Capacity
No. of Patients
at 60 %
Capacity
Utilization
A
B
C=A*3600(Annual
Working Hours)
D=C/B
E=D*60%
2
0.50
7,200
14,400
8,640
General
OPD
Table 2: Installed and Operational Capacity for OPD
Services
Number
of
Doctors
Time
/Patient
(hrs)
Available
Hours/Year
No of
Patients
at 100%
Capacity
No. of
Patients at 60
% Capacity
Utilization
A
B
C=A*900(An
nual
Working
Hours)
D=C/B
E=D*60%
Cardiologist
1
0.50
900
1,800
1,080
Neurophysician
1
0.50
900
1,800
1,080
Orthopaedic
Surgeon
1
0.50
900
1,800
1,080
Gastroenterolog
ist
1
0.50
900
1,800
1,080
Opthalmologist
1
0.50
900
1,800
1,080
Specialist OPD
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Setting Up General Medical and Surgical Hospital
Pulmonologist
1
0.50
900
1,800
1,080
Paediatrics
1
0.50
900
1,800
1,080
Gynaecologist
1
0.50
900
1,800
1,080
Urologist
1
0.50
900
1,800
1,080
Nephrologist
1
0.50
900
1,800
1,080
Dermatologist
1
0.50
900
1,800
1,080
ENT Specialist
1
0.50
900
1,800
1,080
General
Surgeon
1
0.50
900
1,800
1,080
Endocrinologist
s
1
0.50
900
1,800
1,080
Psychiatrist
1
0.50
900
1,800
1,080
Physiotherapist
1
0.50
900
1,800
1,080
28,800
17,280
Total
Table 3: Installed and Operational Capacity for Surgeries
% of Patients who are recommended surgery from OPD
Services
15%
Annual
Capacity
Ratios
No of
Patients at
100%
Capacity
No. of
Patients at 60
% Capacity
Utilization
A=15%*14,400
(No. of OPD
patients)
B
C=A*B
D=C*60%
Appendectomy
10%
216
130
Gallstone
10%
216
130
Hernia
10%
216
130
Hemorrhoids
10%
216
130
13%
281
169
Gastrectomy
12%
259
155
Bowel/Colon Resection
10%
216
130
Thyroidectomy
10%
216
130
Nephrectomy
15%
324
194
2,160
1,298
Surgeries
Laparotomy
2,160
Total
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Setting Up General Medical and Surgical Hospital
Table 4: Installed and Operational Capacity for General Ward & Private Room
Services
Number of
Beds
Annual Occupancy
(Days) @100%
Capacity
Annual Occupancy
(Days) @60% Capacity
Utilization
A
B=A*360
C=B*60%
General Ward
12
4,320
2,592
Private Room
4
1,440
864
ICU Ward
4
1,440
864
Total
20
7,200
4,320
Table 5: Installed and Operational Capacity for Emergency
Services
Emergency
Number
of Beds
Available
Hours/Year
Average
Time
/Patient
(hours)
No of
Patients
at 100%
Capacity
No. of
Patients
at 60 %
Capacity
Utilization
A
B=A*8,640(Annual
Working Hours)
C
D=B/C
E=D*60%
6
51,840
4
12,960
7,776
Table 6: Installed and Operational Capacity for Diagnostic Lab
Description
Total no. of OPD
Patients
OPD
Test Per
Patients
Year
requiring Annual
Tests
Capacity
Complete Blood Count (CBC)
28,800
7,200
7,200
ABO Typing
Group)
28,800
7,200
7,200
X-Ray
28,800
2,880
2,880
Ultra Sound
28,800
2,880
2,880
November 2021
Test
(Blood
17
Pre-Feasibility Study
6.
Setting Up General Medical and Surgical Hospital
CRITICAL FACTORS
Following factors should be taken into account while making the decision to invest in
General Medical and Surgical Hospital:
7.

Engagement of reputed specialists

Employment of trained and professional nurses and other staff

Maintenance of high standards of patients' care

Compliance with the standards of hygiene

Usage of modern, reliable medical equipment along with proper sterilization

Arrangement of skillful operators of the machines

Courteous administrative staff for customer satisfaction

Accurate maintenance of patients’ records

Regular feedback and follow up visits by the patients

Uninterrupted supply of electricity power
GEOGRAPHICAL POTENTIAL FOR INVESTMENT
The patient rate is growing day by day and current health care facilities in the country
are not enough to accomadate all patients which creates the need for new hospitals
and clinics in every city/town of Pakistan.The proposed hospital would ideally be
located near populated rural or urban areas to provide services to the local population.
The proposed hospital would ideally be located in large to medium cities like Karachi,
Lahore, Peshawar, Islamabad, Multan, Quetta, Sialkot, Mardan, Gujranwala,
Hyderabad, Gilgit, Muzaffabad, Sahiwal, Rawalpindi, Bahawalpur, Sukkur, Sahiwal,
Gujrat, Skardu, Dera Ghazi Khan, Larkana, Khuzdar, Layyah, Nowshera, etc. Locating
the proposed business in these cities would provide advantage of being close to larger
population clusters to provide better treatment to the people. The disposable incomes
of the people living in these cities are high which makes it affordable for them to use
the healthcare facilities of such private hospitals.
8.
POTENTIAL TARGET MARKET
Hospitals occupy an important place in the world's healthcare system, providing
personal care for people suffering from different ailments. Hospitals benefit from the
increasing demand for healthcare services in a growing customer base due to ageing
population and less inclination towards a hygeinic lifestyle.
Pakistan is the fifth most populous country in the world, with 227.12 million people,
having an annual population growth rate of 1.8%, which means addition of around 4
million people every year. This increase in population keeps generating additional
November 2021
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
demand for health coverage. According to Economic Survey of Pakistan 2020-21,1 in
the year 2020, Pakistan’s health infrastructure comprised of 1,282 hospitals, 5,472
BHUs,2 670 RHCs,3 5,743 Dispensaries, 752 Maternity & Child Health Centres and
412 TB4 Centres. Total availability of beds in these health facilities was 133,707.
Although public health expenditure has been increasing over the years but it stiil
remains insufficient to ensure provision of quality healthcare to the entire population.
The number of doctors registered in Pakistan at present are about 110,000.5 It is
estimated that around 25,000 Pakistani doctors are working abroad. Remaining
85,000 are working within Pakistan. Pakistan’s population is about 220 million, which
translates into a ratio of one doctor for 2588 persons. The doctor to population ratio,
recommended for developing countries like Pakistan by World Health Organization
(WHO) is 1 doctor for 1,000 persons.
The private sector plays a vital role in the delivery of healthcare services in Pakistan.
A rising population pressure on the state’s health institutions has made it essential that
the private sector comes forward to bridge the rising demand-supply gap. With
increasing disposable incomes and changing lifestyles, people prefer to go to private
hospitals due to availability of state-of-the-art facilities, safe and quality healthcare
services, flexible timings and a patient-centric approach.
In Pakistan, many different diseases exist only due to poor quality of food and hygiene
and less inclination towards exercises and a healthy lifestyle. Few major cities of
Pakistan are included in top most polluted cities of the world. Due to these factors, the
number of patients in Pakistan are increasing day by day.
Health Insurance Card (Sehat Card) issued by government, allows underprivileged
people to access private hospitals. It can be used for surgeries. This grants access to
every person, rich or poor to private hospitals for better teatment.
9.
PROJECT COST SUMMARY
A detailed financial model has been developed to analyze the commercial viability of
the proposed business. Various costs and revenue related assumptions along with
results of the analysis are outlined in this section.
The projected Income Statement, Cost of Goods Sold, Cash Flow Statement and
Balance Sheet are attached as Annexure.
1
https://www.finance.gov.pk/survey_2021.html
A Baic Health Unit (BHU) serves up to 25,000 people with basic medical and surgical care, preventive services,
maternal and child healthcare services.
3
A Rural Health Center (RHC), with an additional facility of 10-20 inpatient beds, dental and ambulance services,
serves a catchment population of up to 100,000 people
4
Tuberculosis Centres
5
https://ayubmed.edu.pk/JAMC/PAST/161/AJKhan.htm#:~:text=The%20doctor%20population%20ratio%2Frec
ommended,to%20fulfill%20our%20own%20needs.
2
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
9.1. Project Economics
All the figures in this financial model have been calculated after carefully taking into
account the relevant assumptions and target market.
9.2. Initial Project Cost Estimates
The details of initial project cost calculated for the proposed business are shown in
Table 7.
Table 7: Initial Project Cost Estimate
Description
Land
Cost
Reference
-
9.1.1
Building / Infrastructure
5,333,010
9.1.2
Medical Machinery and Equipment
17,884,000
9.1.3
Hospital Machinery and Equipment
4,059,000
9.1.4
Furniture & fixtures
2,465,000
9.1.5
Office Vehicles
1,242,300
9.1.6
Office equipment
6,355,000
0
Medical Books
1,000,000
9.1.8
764,489
9.1.9
Security Against Building
4,500,000
9.1.10
Legal and Licensing Fee
100,000
9.1.11
Pre-operating costs
43,702,799
Total Capital Cost
Working capital
Patient Consumables Inventory
512,313
Office Consumables Inventory
102,125
1,500,000
Upfront building rent
Upfront insurance payment
388,738
Cash
1,500,000
Total Working capital
4,003,176
Total Investment
47,705,975
November 2021
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
9.1.1. Land
The hospital will be established in a rented building to avoid the high cost of land.
Suitable locations for setting up a hospital like this can be found on rent. Therefore, no
land cost has been added to the project cost. The proposed hospital will be set up on
three floors that are parking, ground floor and first floor. Total space requirement for
the proposed unit has been estimated as 20,250 sq. ft. The breakup of the space
requirement is provided in Table 8.
Table 8: Land Area Breakup
Description
% Break-Up
Number Area (Sq. Ft.)
Basement
33%
1
6,750
Reception/ Nurses Counter
1%
1
300
Waiting Area
2%
1
500
Surgical Consultant Room
1%
1
270
Operation Theatre (OT)
3%
2
600
Waiting Area for Operation Theatre (OT)
1%
1
280
Recovery Room
3%
1
640
Admin Department
1%
1
150
Washrooms
1%
5
250
Store Room
2%
1
400
General OPD
2%
1
400
Emergency Room
4%
1
750
Specialist Doctors Consultation Rooms
7%
4
1,440
Blood Bank
1%
1
160
Specialist Doctors Common Room
1%
1
270
Corridor
1%
1
160
Stairs
0.5%
1
100
Lift Area
0.4%
1
80
Parking
Ground Floor
Sub Total
6,750
First Floor
Private Room
5%
4
960
Nurses Room
1%
1
210
Procurement Department
1%
1
160
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
HR Department
1%
1
180
General Ward
5%
1
1,000
ICU Ward
2%
1
400
Diagnostic Lab
3%
1
600
Physiotherapy Room
1%
1
300
Washrooms
2%
10
400
Medical Officer Office
1%
1
240
Medical Store
2%
1
500
Canteen
2%
1
400
Waiting Area
4%
1
800
Kitchen
0.4%
1
80
Prayer Area
1%
1
180
Corridor
1%
1
160
Stairs
0.5%
1
100
Lift Area
0.4%
1
80
Sub Total
6,750
Total Area
100%
20,250
9.1.2. Building
There will be no cost of building since the unit will be started in a rented premise.
However, there will be a renovation cost; required to make the building usable for the
hospital. The proposed project requires electricity load of 21 KW for which an electricity
connection under the General Supply Tariff-Commercial three phase will be required.
Building rent of PKR 1,500,000 per month has been included in the operating cost.
Building renovation cost is shown in Table 9.
Table 9: Building Renovation Cost
Units of
Measurement
Total
Units
Cost/Unit
(PKR)
Paint Cost
Liter
417
600
250,200
Labour Cost
Sq. Feet
41,706
10
417,060
Wall Racks
No.
49
15,000
735,000
Lockers
No.
23
30,000
690,000
Particulars
Woodwork Cost
Curtains
November 2021
Total Cost
(PKR)
1,000,000
No.
27
22
5,000
135,000
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Blinds
No.
20
5,000
100,000
Glass Door and PartitionGround Floor
Sq. Feet
1,737
550
955,350
Glass Door and Partition- 1st
Floor
Sq. Feet
1,728
550
950,400
Painting & Decorative &
Medical Charts
100,000
TOTAL (PKR)
5,333,010
9.1.3. Medical Machinery and Equipment
Table 10 gives details of the medical machinery and equipment required for the
project.
Table 10: Medical Machinery & Equipment
Cost Item
No.
Unit Cost
(PKR)
Total Cost
(PKR)
Ventilator
2
1,800,000
3,600,000
Patients Monitor
6
70,000
420,000
Defibrillator
5
250,000
1,250,000
Suction Machine
5
50,000
250,000
BiPap
5
200,000
1,000,000
OT Lights with Halogen Bulbs
4
250,000
1,000,000
General Surgery Set
6
35,000
210,000
Appendectomy Set
4
15,000
60,000
Gallstone Surgery Set
4
20,000
80,000
Hernoia Surgery Set
4
12,000
48,000
Hemorrhoidictomy Set
4
15,000
60,000
Thyroidectomy Set
4
20,000
80,000
Laparotomy Set
4
22,000
88,000
X-ray Illuminator (2 Film)
6
5,000
30,000
Patient Monitor
8
70,000
560,000
ICU Equipment
Surgery Related Equipment and Tools
Physiotherapy Equipment
November 2021
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Therapeutic Ultrasonic
1
750,000
750,000
Electrotherapy TENS Machine
5
10,000
50,000
Vibrators & Massagers
20
3,000
60,000
Foot massager and pain releiver
4
20,000
80,000
Interferential Electric Muscle Stimulator
2
25,000
50,000
Diathermic- Shortwave CDB-1
1
150,000
150,000
Diathermic- Mediumwave CDB-1
1
150,000
150,000
Shoulder Pullies
5
2,000
10,000
Static Cycle
1
50,000
50,000
Magnetic Exercise Cycle
1
60,000
60,000
Gym Ball
5
5,000
25,000
Quadriceps strengthening Machine
2
50,000
100,000
Automated / Digital Tractions
1
150,000
150,000
Automated Treadmill
1
100,000
100,000
Digital Water bath
2
25,000
50,000
CBC Analyzer
1
400,000
400,000
Compound Digital Microscope (Mechanical
Stage:130×140mm
Moving
Range
75mm×45mm)
2
45,000
90,000
Ultrasound - Color Doppler Machine (17''
LED, Cine loop: 1024 frames)
1
1,050,000
1,050,000
Thermal Ultrasound Printer
1
100,000
100,000
1
1,500,000
1,500,000
X-Ray Illuminators
4
5,000
20,000
X-Ray Printer
2
30,000
60,000
Autoclave
2
15,000
30,000
Stethoscope
12
2,500
30,000
Gluco Meter
12
5,000
60,000
Head Torch
12
1,000
12,000
Blood Pressure Monitor Set
12
2,000
24,000
Weigh Scale (310 g, 220 V)
12
11,000
132,000
Diagnostic Lab Equipment
Digital X-Ray Machine (35KW,
inverted Frequency: 50khz)
Main
OPD Equipment
November 2021
24
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Medical Thermometer
12
1,000
12,000
Examination Light
8
3,000
24,000
ECG Machine
2
150,000
300,000
First aid Kits
10
5,000
50,000
Reflex Hammer
10
100
1,000
Magnifiers
8
1,500
12,000
Dressing Kits
10
300
3,000
Instrument Sterilizer
5
25,000
125,000
Testing Meter (insulin level)
6
10,000
60,000
Medical Oxygen Concentrator
16
100,000
1,600,000
Oxygen cylinders
16
20,000
320,000
Nebulizer
16
3,000
48,000
Generator (24 Kw)
1
1,250,000
1,250,000
Other Equipment
Total
17,884,000
9.1.4. Hospital Machinery and Equipment
Table 11 gives details of the medical machinery and equipment required for the
project.
Table 11: Hospital Machinery and Equipment
Cost Item
Number
of Items
Unit
Cost
(PKR)
Total
Cost
(PKR)
Hospital Beds
26
18,000
468,000
Examination Couch
11
12,000
132,000
Adjustable Stool
6
6,000
36,000
Bed Side Table Set
26
16000
416,000
Over Bed Table
30
8,000
240,000
Benches
8
13,000
104,000
Wheel Chair
10
12,000
120,000
Stretcher
10
11,000
110,000
OT Table/Bed
2
120,000
240,000
Equipment Trolly
16
10,000
160,000
November 2021
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
ICU Beds
4
200,000
800,000
Attendent's Couch
18
6,000
108,000
Mattress
26
15,000
390,000
Stretcher trolly
4
15,000
60,000
IV Stand With plastic wheel
26
5,000
130,000
Ward screen 4-Fold
14
5,000
70,000
Wheel Chairs
6
25,000
150,000
Bed Pan
30
2,000
60,000
Foot Steps
30
2,000
60,000
Waste Bin
30
2,000
60,000
Medical Waste Bin
6
7,500
45,000
Sound/AnnouncementSystem
1
100,000
100,000
Total
4,059,000
9.1.5. Furniture and Fixture
Table 12 gives details of the furniture and fixture required for the project.
Table 12: Furniture and Fixtures
Cost Item
Number of
Items
Unit Cost (PKR)
Total Cost (PKR)
Executive Tables
10
30,000
300,000
Executive Chairs
12
20,000
240,000
General Table
25
25,000
625,000
Reception Counter
1
40,000
40,000
Sofa Set
12
35,000
420,000
General Chairs
84
10,000
840,000
2,465,000
Total
9.1.6. Office Vehicles
Details of vehicles required for the project is given in Table 13.
Table 13: Office Vehicles
Cost Item
Number of Vehicles
Unit Cost (PKR)
Bolan Van
1
1,150,000
1,150,000
Bikes
1
80,000
80,000
November 2021
26
Total (PKR)
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Registration Charges
1%
12,300
Total
1,242,300
9.1.7. Office Equipment
Details of office equipment of the hospital are given in Table 14.
Table 14: Office Equipment
Cost Item
Number
of Items
Unit
Cost
(PKR)
Total
Cost
(PKR)
Laptop Computers
5
80,000
400,000
Printers
4
40,000
160,000
Desktop Computer
4
30,000
120,000
Security System (2MP)
30
2,000
60,000
DVR
3
12,000
36,000
LED
12
40,000
480,000
Air Conditioners (1.5 ton Inverter)
34
90,000
3,060,000
Ceilling Fan
38
5,000
190,000
Exhaust Fan
22
3,000
66,000
Water Dispensers
5
20,000
100,000
Wi-Fi / Internet Routers
4
5,000
20,000
Telephone Sets
14
2,000
28,000
UPS (Complete Installation 3000 Inverter)
4
250,000
1,000,000
Private Rooms Refrigerator
7
60,000
420,000
Refrigerator
1
100,000
100,000
Coffee/Tea-maker
1
15,000
15,000
Microwave Oven
2
30,000
60,000
Pump-motor (1.5 HP)
2
20,000
40,000
Total
November 2021
6,355,000
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
9.1.8. Medical Books
Details of medical books for the hospital is given in Table 15.
Table 15: Medical Books
Cost Item
Number of
Books
Unit Cost (PKR)
100
10,000
Medical Books
Total Cost (PKR)
1,000,000
9.1.9. Pre-Operating Cost
Details of pre operating cost of the hospital is given in Table 16.
Table 16: Pre-Operating Cost
Cost Item
Number of Months
Total Cost (PKR)
Administration expenses
1
530,000
Utilities expenses
1
234,489
Total (PKR)
764,489
9.1.10.
Security against Building
Details of security against rented building for the project is given in Table 17.
Table 17: Security against Building
Description
Security
Building
Months
Rent per Month (PKR)
3
1,500,000
against
Total (PKR)
4,500,000
9.1.11. Legal and Licensing Fee
Details of legal licensing fee required for the project is given in Table 18.
Table 18: Legal and Licensing Fee
Cost Item
Total Cost (PKR)
License Fee For Hospital6
6
100,000
https://www.phc.org.pk/licensingfee.aspx
November 2021
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Setting Up General Medical and Surgical Hospital
9.1.12. Breakeven Analysis
Table 19 shows calculation of breakeven analysis.
Table 19 : Breakeven Analysis
Description
Amount First Year
(PKR)
Ratios
Sales (PKR) – A
159,309,000
100%
Variable Cost (PKR) – B
106,982,867
67%
Contribution (PKR) (A-B) = C
52,326,133
33%
Fixed Cost (PKR) – D
42,624,556
27%
Breakeven Revenue (PKR)
42,624,556
Number of patients at Breakeven
34,840
Breakeven Capacity
41%
9.1.13. Revenue Generation
Table 20: Revenue Generation
Revenue
(PKR)
Services
Reference
General OPD
8,640,000
Emergency
7,776,000
Specialists OPD
43,200,000
Table 22
OT (Surgeries)
53,955,000
Table 23
General Ward
7,776,000
Private Room
12,960,000
ICU Ward
17,280,000
Diagnostic Lab
5,616,000
Table 25
Rent received
2,106,000
Table 26
Total Revenue (PKR)
Table 21
Table 24
159,309,000
Table 21: Reveneue from General OPD and Emergency
No. of Patients @ 60%
Initial Capacity
Service
Charges (PKR)
General OPD
8,640
1,000
8,640,000
Emergency
7,776
1,000
7,776,000
Services
November 2021
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Revenue
(PKR)
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Table 22: Revenue from Specialist OPD
Specialist OPD
No. of Patients @
60% Initial
Capacity
Service
Charges (PKR)
Revenue(PKR)
Cardiologist
1,080
2,700,000
Neurophysician
1,080
2,700,000
Orthopaedic Surgeon
1,080
2,700,000
Gastroenterologist
1,080
2,700,000
Opthalmologist
1,080
2,700,000
Pulmonologist
1,080
2,700,000
Paediatrics
1,080
2,700,000
Gynaecologist
1,080
Urologist
1,080
2,700,000
Nephrologist
1,080
2,700,000
Dermatologist
1,080
2,700,000
ENT Specialist
1,080
2,700,000
Immunologist
1,080
2,700,000
Endocrinologists
1,080
2,700,000
Psychiatrist
1,080
2,700,000
Physiotherapist
1,080
2,700,000
Total
17,280
43,200,000
2,500
2,700,000
Table 23: Revenue from OT
No. of Patients @
60% Initial Capacity
Service
Charges (PKR)
Revenue
(PKR)
Appendectomy
130
30,000
3,900,000
Gallstone
130
35,000
4,550,000
Hernia
130
40,000
5,200,000
Hemorrhoids
130
30,000
3,900,000
Laparotomy
169
30,000
5,070,000
Gastrectomy
155
85,000
13,175,000
Bowel/Colon Resection
130
35,000
4,550,000
Thyroidectomy
130
45,000
5,850,000
Surgeries
November 2021
30
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Percutaneous
Nnephrolithotomy
194
40,000
Total (PKR)
1,298
7,760,000
53,955,000
Table 24: Revenue from Wards and Rooms
Annual Occupancy
(Days)@ 60% Initial
Capacity
Service
Charges (PKR)
Revenue
(PKR)
General Ward
2,592
3,000
7,776,000
Private Room
864
15,000
12,960,000
ICU Ward
864
20,000
17,280,000
Total
4,320
Services
38,016,000
Table 25: Revenue from Diagnostic Lab
Test Per Year @
60% Initial Capacity
Charges Per
Test (PKR)
Revenue
(PKR)
Complete Blood Count
(CBC)
4,320
500
2,160,000
ABO Typing Test (Blood
Group)
4,320
200
864,000
X-Ray
1,728
700
1,209,600
Ultra Sound
1,728
800
1,382,400
Total
12,096
Tests
5,616,000
Table 26:Revenue from Rent
Description
Area
(sq. feet)
Rent/ Sq.feet
per month
(PKR)
Rent - Medical
Store
500
120
60,000
720,000
Rent- Canteen
400
120
48,000
576,000
Rent- Parking
6,750
10
67,500
810,000
175,500
2,106,000
Total
November 2021
31
Total Income
/ Month
(PKR)
Total Income
/ Year (PKR)
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
9.1.14. Variable Cost
Variable costs of the project have been provided in Table 27.
Table 27: Variable Cost
Description of Costs
Amount
(PKR)
Patient Consumables (Table 28)
4,649,230
Surgeon Charges (60% of revenue from OT)
32,373,000
Specialist Charges (60% of revenue from Specialists OPD)
25,920,000
Other Consumables (Table 29)
1,225,500
Diagnostic Lab Consumables (Table 30)
273,024
Direct Labour Cost
35,160,000
Electricity
2,813,872
Utilities (Water, Gas, Internet)
722,400
Communications expense (phone, internet etc.)
433,440
Office vehicles running and maintenance expense
1,753,461
Office expenses (stationery, entertainment, janitorial services,
etc.)
Office Consumables
433,440
1,225,500
Total (PKR)
106,982,867
Table 28: Patient Consumables
Cost Item
Number
of Items
Unit
Cost
(PKR)
Total
Cost
(PKR)
Cotton Absorbent (Packs) 500 Grams Pack
433
500
216,500
Bandages Pack (12 Pieces)
649
400
259,600
Syringes (pack of 20)
5,192
40
207,680
Anesthesia (Complete)
1,298
3,000
3,894,000
Surgical Spirit ( 5L Pack)
65
100
6,500
Tissue Papers/Rolls
433
150
64,950
4,649,230
Total
November 2021
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Table 29: Other Consumables
Cost Item
Unit of
Measurement
Number
of Items
Unit
Cost
(PKR)
Total Cost (PKR)
Surgical Face Mask
Packs
416
150
62,400
Surgical Gloves
Packs
208
1,300
270,400
Medical Overall
10
700
7,000
OT Shoes
10
1,000
10,000
Scrubs
4
1,100
4,400
Sterilization Towel
10
1,600
16,000
Povidone-iodine
208
100
20,800
Hand Sanitizer
720
250
180,000
Syringe Needle Cutter
6
300
1,800
Sweeper Kit
2
20,000
40,000
Polythene gloves
Packs
208
50
10,400
Paper Napkins
Packs
360
250
90,000
Mop
12
200
2,400
Bucket
6
500
3,000
Besoms
12
250
3,000
Phenyle
120
160
19,200
Floor Broomer
10
270
2,700
Tissue papers
3,300
90
297,000
Tissue rolls
5,400
20
108,000
Soaps
12,000
Insecticides
15,000
Air Fresheners
15,000
Towels
20,000
Cotton Rolls
15,000
Total
November 2021
1,225,500
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Table 30:Diagnostic Lab Consumables
Cost Item
Number
of Items
Unit
Cost
(PKR)
Total
Cost
(PKR)
Glass vial
7,200
8
57,600
Glass Slides
144
30
4,320
Lancets
7,200
5
36,000
X Ray Film
2,880
100
288,000
Ultrasound Gel (Grams)
2,880
24
69,120
455,040
Total (A)
Initial Year Capacity Utilization (B)
60%
Initial Year Diagnostic Lab Consumables
(C=A*B)
273,024
9.1.15. Fixed Cost Estimate
Table 31 shows the estimated fixed cost of the project.
Table 31: Fixed Cost Estimate
Description of Costs
Annual cost (PKR )
Administration expense
14,448,000
Administration benefits expense
1,488,240
Building rental expense
18,000,000
Promotional expense
796,545
Insurance expense
388,738
Professional fees (legal, audit, consultants, etc.)
Depreciation expense
1,593,090
5,737,046
Amortization of pre-operating costs
152,898
Amortization of legal, licensing, and training costs
20,000
Total (PKR)
November 2021
42,624,556
34
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
9.1.16. Financial Feasibility Analysis
The financial feasibility analysis provides the information regarding projected IRR,
NPV and payback period of the study, which is shown in Table 32.
Table 32: Financial Feasibility Analysis
Description
Project
IRR
53%
NPV (PKR)
153,897,153
Payback Period (years)
2.56
Projection Years
10
Discount rate used for NPV
15%
9.1.17. Financial Feasibility Analysis with 50% Debt
The financial feasibility analysis provides the information regarding projected IRR,
NPV and payback period of the study on the basis of Debt: Equity Model (50:50), which
is shown in Table 33.
Table 33: Financial Feasibility Analysis with 50% Debt
Description
Project
IRR
52%
NPV (PKR)
173,422,454
Payback Period (years)
2.65
Projection Years
10
Discount rate used for NPV
13%
9.1.18. Human Resource
For the 1st year of operations, the hospital shall require the workforce at a salary cost
shown in Table 34.
Table 34: Human Resource Requirement
Post
No. of
Employee
s
Monthly
Salary
(PKR)
Total
Salary per
Month
(PKR)
Annual
Salary (PKR)
CEO
1
250,000
250,000
3,000,000
Admin and HR Manager
1
100,000
50,000
1,200,000
Admin Assistant
2
50,000
100,000
1,200,000
November 2021
35
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
1
100,000
50,000
1,200,000
Assistant Accountant
2
40,000
80,000
960,000
Procurment Officer
1
70,000
70,000
840,000
Assistant
Officer
1
40,000
40,000
480,000
HR Assisstant
1
40,000
40,000
480,000
Store Keeper
2
40,000
80,000
960,000
Accounts
Manager
and
Finance
Procurement
Technical Staff
0
General Physician
2
175,000
350,000
4,200,000
Junior Doctor
5
100,000
500,000
6,000,000
Anaesthesiologists
2
40,000
80,000
960,000
Nurses
29
40,000
1,160,000
13,920,000
OT Staff
4
50,000
200,000
2,400,000
X-Ray
Technician
/
Radiological Technologist
1
50,000
50,000
600,000
X-Ray
Printing
-
1
50,000
50,000
600,000
Sonographer (Ultrasound
Technician)
1
50,000
50,000
600,000
Lab Technician
2
50,000
100,000
1,200,000
Lab Assistants
2
30,000
60,000
720,000
Receptionist
2
40,000
80,000
960,000
Sweeper
6
22,000
132,000
1,584,000
Security Guard
15
22,000
330,000
3,960,000
Office Boy
6
22,000
132,000
1,584,000
Total
90
Technician
November 2021
49,608,000
36
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
10. CONTACT DETAILS
Names of some relevant medical and surgical equipment suppliers are provided in
Table 35.
Table 35: Suppliers of Equipment & Supplies
Name
Item
Contact No
E.mail/Website
Advance Systems –
Karachi, Islamabad,
Lahore
Surgical
Equipment
02134553632
0512854026
04237429665
www.advancesystems.
com.pk
Medco – Peshawar
Medical
Equipment
091-2212702
www.medco.net.pk
Strongman Medical
Products – Faisalabad
Medical/
Surgical
Supplies
0418810078
www.strongmanonline.
com
Health Care Supplies –
Karachi
Hospital
Supplies
02134820375
www.healthcaresuppli
es.com.pk
Medtronic – Ireland
Medical
Solutions
+3531438170
0
www.medtronic.com
Johnson & Johnson –
USA
Medical
Devices
+1732524040
0
www.jnj.com
Terumo Corporation,
Japan
Medical
+8133374811
Tools and 1
Equipment
Abbot Laboratories,
Pakistan
Diagnostic
Tools
042 35854141 www.pk.abbott
Coloplast Group ,
Denmark
Medical
Devices
+4549111111
November 2021
37
www.terumo.com
www.coloplast.com
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
11. USEFUL LINKS AND CONTACTS
Table 36: Useful Links
Name of Organization
Website
Small and Medium Enterprises Development
Authority (SMEDA)
www.smeda.org.pk
National Business Development Program (NBDP)
www.nbdp.org.pk
Ministry of National Health Services Regulations and
Coordination
www.nhsrc.gov.pk/
Specialized Healthcare and Medical Education
Department Lahore
health.punjab.gov.pk/
Government of Punjab
punjab.gov.pk/
Government of Sindh
sindh.gov.pk/
Government of Balochistan
balochistan.gov.pk/
Government of KPK
kp.gov.pk/
Government of Gilgit Baltistan
gilgitbaltistan.gov.pk/
Government of Azad Jammu & Kashmir
ajk.gov.pk/
Ministry of National Health Services Regulations and
Coordination
www.nhsrc.gov.pk
World Health Organization
www.who.int
National Institute of Health
www.nih.org.pk/
Pakistan Medical Commission
www.pmc.gov.pk
Security and Exchange Commission of Pakistan
www.secp.gov.pk
State Bank of Pakistan
www.sbp.gov.pk
November 2021
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Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
Table 37: Healthcare Commissions - Contact Numbers
Name of Organization
Website
Contact
Islamabad Healthcare Regulatory
Authority
https://ihra.gov.pk
051-9199902
Punjab Healthcare Commission
https://www.phc.org.pk
042-99333161
Sindh Healthcare Commission
http://shcc.org.pk
111-117-422
Khyber Pakhtunkhwa Healthcare
Commission
http://hcc.kp.gov.pk
091-9213242
Balochistan Healthcare Commission
https://balochistan.gov.
pk/departments/health/
081-9202287
Directorate of Health Services Gilgit
Baltistan
-
05811-920280
Department of Health Services Azad
Jammu & Kashmir
https://health.ajk.gov.pk
0582-2920015
November 2021
39
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
12. ANNEXURES
12.1.
November 2021
Income Statement
40
`
Pre-Feasibility Study
12.2.
November 2021
Setting Up General Medical and Surgical Hospital
Balance Sheet
41
`
Pre-Feasibility Study
12.3.
November 2021
Setting Up General Medical and Surgical Hospital
Cash Flow Statement
42
`
Pre-Feasibility Study
Setting Up General Medical and Surgical Hospital
13. KEY ASSUMPTIONS
13.1.
Operating Cost Assumptions
Table 38: Operating Cost Assumptions
Description
Details
Building rent growth rate
10%
Furniture and fixture depreciation
15%
Vehicle depreciation
15%
Office equipment depreciation
15%
Inflation rate
10.1%
Wage growth rate
9.7%
Electricity price growth rate
9%
Office equipment price growth rate
9.6%
Office vehicle price growth rate
6.2%
13.2.
Revenue Assumptions
Table 39: Revenue Assumptions
Description
Details
Service charges growth
10.1%
Initial year capacity utilization
60%
Capacity utilization growth rate
5%
Maximum capacity utilization
90%
13.3.
Financial Assumptions
Table 40: Financial Assumptions
Description
Details
Project life (Years)
10
Debt: Equity
0:100
Discount Rate
15%
November 2021
43
Pre-Feasibility Study
13.4.
Setting Up General Medical and Surgical Hospital
Debt Related Assumptions
Table 41: Debt Related Assumptions
Description of Cost
Details
Project Life (Years)
10
Debt: Equity
50:50
Discount Rate
13%
Debt Tenure
5 years
Grace Period
1 Year
Interest Rate (KIBOR+3%)
10.3%
13.5.
Cash Flow Assumptions
Table 42: Cash Flow Assumptions
Description
Details
Accounts receivable cycle (in days)
-
Accounts payable cycle (in days)
-
November 2021
44
Small and Medium Enterprises Development Authority
HEAD OFFICE
4th Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road, Lahore
Tel: (92 42) 111 111 456, Fax: (92 42) 36304926-7
www.smeda.org.pk, helpdesk@smeda.org.pk
REGIONAL OFFICE
PUNJAB
REGIONAL OFFICE
SINDH
REGIONAL OFFICE
KPK
REGIONAL OFFICE
BALOCHISTAN
3rd Floor, Building No. 3,
Aiwan-e-Iqbal Complex,
Egerton Road Lahore,
Tel: (042) 111-111-456
Fax: (042) 36304926-7
helpdesk.punjab@smeda.org.pk
5TH Floor, Bahria
Complex II, M.T. Khan Road,
Karachi.
Tel: (021) 111-111-456
Fax: (021) 5610572
helpdesk-khi@smeda.org.pk
Ground Floor
State Life Building
The Mall, Peshawar.
Tel: (091) 9213046-47
Fax: (091) 286908
helpdesk-pew@smeda.org.pk
Bungalow No. 15-A
Chaman Housing Scheme
Airport Road, Quetta.
Tel: (081) 831623, 831702
Fax: (081) 831922
helpdesk-qta@smeda.org.pk